L.A. County D.A. looking into raises given to ex-Cudahy city manager

The Los Angeles County district attorney has begun investigating whether the former city manager of Cudahy illegally gave himself cost-of-living raises meant for rank-and-file employees.

David Demerjian, head of the D.A.’s Public Integrity Division, said he has opened an inquiry into allegations of misappropriation of public funds by George Perez.

The inquiry comes after The Times reported that in addition to a contract that guaranteed him a generous 8% annual raise, Perez for many years received additional increases of 2% to 3.5%.

Perez’s contract also guaranteed him 12 weeks vacation and sick leave.

“Every payment he received was with the approval of the sitting City Council,” said Perez’s attorney, Stanley L. Friedman.

Hector Rodriguez, Cudahy’s current city manager, said there is no record the council ever approved the cost-of-living raises.

Perez was fired in 2011 after 11 years on the job. Council members have never provided an explanation.

Perez was a city janitor before he was elected to the council in 1994. He had little administrative experience, and no college degree, when his colleagues named him city manager. The district attorney looked into Perez’s hiring at the time but dropped the matter.

Beginning with his second contract as city manager, Perez was supposed to receive an annual raise equivalent to the increase in the CPI or an 8% annual raise, whichever was greater. The contract was effective April 16, 2003.

About 21/2 months after signing the contract, Perez received a 2% cost-of-living increase, according to records reviewed by The Times.

For the next five years, Perez received an 8% increase each April, and a cost-of-living raise of 2% to 3.5% three months later.

In October 2008 he signed another five-year contract, starting at $172,548, with similar terms.

Although the new contract said he would receive a raise each October, city records show he received his 8% boost in April 2009, six months early.

Friedman said his client didn’t take his last raises because of the city’s poor financial condition.

While researching a public records request from The Times, Cudahy officials said they found the city’s records were in disarray.

They found draft council meeting minutes for 2003 and 2008 that were never approved and audio recordings of meetings for 2005 and 2006 that had not been transcribed. The draft minutes do not mention any cost-of-living increase for Perez. Neither do the minutes for the years the City Council formally approved minutes.

Besides serving as city manager, Perez earned an additional $23,500 a year as a director of a private company that provides water to Cudahy, raising questions of conflict of interest.

jeff.gottlieb@latimes.com